EQT is taking a discerning approach to crack Asia’s vast and dynamic wealth market, looking to bring differentiated and complementary offerings to private banks and distributors across the region as competition heats up.

After establishing distribution networks in Hong Kong, Singapore, Thailand and Australia since 2023, the Swedish private equity firm has expanded its footprint to Malaysia, Taiwan, South Korea, and Japan this year with local distributor partnerships, while actively exploring opportunities in China through the QDLP programme.

“Normally, people would just focus heavily on Hong Kong and Singapore and not really spend too much time on the regional markets. But I think for EQT’s mission, we don’t just want to do more of the same, we want to be able to provide access to individuals across the world,” Sueann Yeo, head of APAC private wealth at EQT, told Asian Private Banker in a recent interview.

However, some of these Asian markets may have high entry barriers for global private equity players. To address different market dynamics, Yeo explained EQT takes a “local with locals” coverage approach, placing teams that speak the local languages on the ground to understand regulatory environments and local nuances to build relationships with distribution partners.

“Those who perform that will remain in this game”

The level of sophistication of end clients in Asian markets varies, requiring support for partners, such as education, thought leadership, marketing and roadshows, Yeo explained.

One of the prime examples of EQT’s extensive efforts on this front is in Malaysia, where the firm was the first to bring a semi-liquid private equity strategy to the market through a local distribution partner. Apart from roadshows in the capital Kuala Lumpur, Yeo shared that the firm also dug into cities including Penang, Kota Kinabalu, and Johor Bahru to support the distributors’ outreach to local clients.

EQT has built a strong bench for its private wealth business in Asia over the past three years, with 14 client relationship specialists across markets such as Singapore, Hong Kong, Australia, and Japan. They are supported by EQT’s global private wealth team of nearly 100 dedicated professionals.

With the competition for winning over Asian private wealth clients growing more fierce as more players, including private-only and traditional long-only asset managers, join the race, Yeo expects an industry shakeout in the coming years as performance dispersion emerges.

“We’re in the very early innings of the evergreen market. What will really differentiate us – and I’m very excited to see in the next few years – is performance. Because at the end of the day, it’s really those who perform that will remain in this game,” Yeo said.

Asia strategies

When the Sweden-based firm launched its evergreen wealth strategy, EQT Nexus, in 2023, it started with private equity, where it had the deepest experience and deal flows.

While some peers tend to focus heavily on the US market, EQT has built a track record in allocating capital across Europe and Asia. The firm joined with Baring Private Equity Asia (BPEA) three years ago, and the duo has become a significant pan-Asia buyout manager.

“You’re essentially getting meaningful non-US [exposure] with us. That’s one of the ways we have designed to be complementary to what investors already have in the portfolio,” Yeo said.

A key to EQT’s private equity playbook is control buyout of high-quality companies, particularly in the healthcare and technology sectors. By leveraging its operational toolbox and value creation initiatives, such as enhanced governance that is rooted in its Nordic heritage, the firm helps its portfolio companies to improve profit margins.

This approach, in Yeo’s view, is also crucial for EQT to achieve strong Distributions to Paid-In Capital (DPI), meaning it can return capital quickly to its end clients.

Although private credit and secondaries have gained investor attention lately, Yeo said private equity is a more timeless investment.

“I think more and more investors have been buying into the fact that if you go private, you might be able to outperform your existing public investments. If you look at our returns on private equity investment, it’s very consistent. We’re showing investors that private equity investment makes sense from the asset allocation perspective, as opposed to simply discussing yields and discounts,” she said.

Value-added infrastructure opportunities

The firm has also recently expanded its evergreen strategies beyond private equity to include EQT Nexus Infrastructure.

For infrastructure investing, EQT adopts a value-added approach rather than focusing on traditional core infrastructure like toll roads or airports. The firm considers essential services, including digital infrastructure such as data centres, fibre networks and cybersecurity companies, as its investment targets.

Yeo said her team is educating the market about the spectrum of infrastructure investments, emphasising that value-added strategies can offer higher returns, although they may not always provide the yield associated with the core ones.

“A lot of distributors have been following what has worked, which is finding a core fund with yield, and more are onboarding more of the same.

“But if a private bank or a distributor wants to be different, they can actually start by being the first few ones to offer value-added infrastructure. I think it’s a massive opportunity for distributors here,” she told APB.

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